On Friday, both the S&P 500 and NASDAQ composite reached all-time highs, fueled by a surge in large-cap stocks, enthusiasm for AI, and a favorable outlook for monetary policy. This marked a significant recovery for US stocks, which had been struggling for months.
The S&P 500, or Benchmark Index, climbed 0.2% to hit 6,154.81 points, exceeding its earlier peak of 6,147.43 from February 19. Meanwhile, the tech-focused Nasdaq rose 0.3%, reaching 20,229.31 points, surpassing its prior record of 20,204.58 set on December 16.
Investor sentiment improved this week, largely due to positive projections from chipmaker Micron. Additionally, Nvidia, a leader in AI, reached new highs, reclaiming its title as the world’s most valuable company.
The market’s risk appetite was buoyed by a ceasefire brokered by the US, which came after 12 days of conflict between Israel and Iran, leading to price spikes in crude oil and heightened inflation concerns.
Dovish remarks from Federal Reserve officials also played a role in fostering positive sentiment.
The imposition of “mutual tariffs” on key trading partners by Trump earlier in April created turbulence, causing a notable downturn and dropping the S&P 500 by 19% from its peak on February 19.
Shortly after Trump’s “liberation day” announcement on April 2, the Nasdaq officially entered bear market territory, plummeting by 26.7% from its previous high.
Since then, new trade agreements with the US have shifted expectations towards the potential for further deals, especially hopes that negotiations between the UK and China could avert a global recession.
Since the recent low on April 8, the S&P 500 has surged over 23.5%, with the Nasdaq seeing an even larger increase of about 32%.
If the Nasdaq closes above its previous record of 20,173.89 from December 16, it could signify the end of the bear market and usher in a new bull market.
A bear market is typically characterized by a decline of 20% or more from the peak closing values.
As of Thursday’s market close, both the NASDAQ and the S&P 500 reported gains of 4.4% for the year, while the Blue-Chip Dow climbed around 2%, still trailing about 3.7% from its past peak.
